Wednesday, October 27, 2004

The nation spends 37,000 Rs every minute for the parliament to function properly. There is an increase of 3400 percentage in the cost per MP in the last twenty years. The members of Parliament even collect allowances when they boycott the Parliament. They are entitled to several other allowances too. My article titled "The easy guide to how much money you spend on Parliament" was published in The Indian Express on October 27th 2004.

At RS 437 crore in 2003-04, it costs the nation Rs 37,000 per minute to keep Parliament functioning.

The 400 hours estimated to have been lost in the last two sessions of Parliament in June, July and August 2004 have meant a financial loss to the exchequer ranging from Rs 88 crore to 207 crore.

The time parliamentarians spend discussing budgetary issues has declined from 23 per cent in 1970s to a mere 10 per cent today. And in 2004, the Finance Bill had to be passed without any debate at all.

The cost per MP (790 MPs, combining both houses) has risen from Rs 1.58 lakh in 1983-94 to 55.34 lakh in 2003-04. An increase of 3,400 per cent!

During the same period, consumer price index increased 500 per cent, and the average emolument for public sector employees increased 900 per cent.

It has been reported in the media, that 400 hours or 24,000 minutes were lost due to disruption of Parliamentary proceedings in the last two sessions spread over June, July and August. For the first time, even the finance bill could not be debated, ‘‘tainted ministers’’, Savarkar and other issues stalled parliament for days.

There has been a worrisome decline in terms of time spent on issues such as the union budget. According to one estimate, between 1952 and 1979, the Parliament devoted on an average 23% of its time on discussing and debating budget related issues. However, between 1980 and 2001 the time devoted to budgetary issues had come down to only 10%. In addition, the number of days when Parliament is in session has been steadily declining from 143 days in 1980 to merely 90 days 2001. This includes all the three basic sessions of Parliament — Budget session, monsoon session and winter session.

At a cost of about Rs. 37,000 per minute or about Rs. 22 lakh an hour or Rs. 1.7 crore per day (assuming that Parliament works for 245 days a year for 8 hours a day), on the basis of annual budgetary allocation for both houses of Parliament in 2003-04 at Rs 437 crore, the total loss in terms of public money comes to about Rs 88 crore or USD 19.5 million, for the 400 hours in the first two sessions of 14th Parliament.

Earlier, when members used to boycott Parliament, they did not collect their daily parliamentary allowances. Today, however, MPs feel free to disrupt the house from within and have no compunction about collecting their allowance for their labour. If members don’t sign their attendance and decline to collect their daily allowance at Rs. 500 days, then the exchequer could at least save Rs 3,95,000 each day for the 790 member. In the past two decades, the budgetary allocation for both houses of Parliament has increased from a mere Rs 12.49 crore in 1983-84, to Rs. 437.15 crore in 2003-04. A whopping 35 fold increase in 20 years!

As a point of comparison, the general consumer price index for industrial workers increased only five fold between 1982 and 2004. Even the per capita emoluments for the much vaunted public sector employees increased from Rs 21,549 in 1983-84 to Rs 1,93,205 in 2001-02, about 9 fold increase.

In contrast, on a per capita basis, the expenditure incurred on each of our 790 Members of Parliament of both houses, in 2003-04 at Rs 437 crore, comes to about Rs 55 lakh per MP. A 3400% increase over two decades. It was a mere Rs 1.58 lakh in 1983-84.

This in a country where the per capita income is estimated at about USD 450/- or Rs 20,250/-, which even in purchasing power parity (PPP US dollar 2500/-) terms would translate in to Rs. 1,12,500/-.

Our MPs cost us about 20 times more than what an average industrial worker earns in a year, and about 40 times the earnings of an ordinary citizen. And all this is after putting in only about 80 parliamentary working days in a year, compared to about 250 days put in by an urban salaried worker.

The annual cost of Rs 300 crore may look to be a small price to pay for maintaining Parliamentary democracy in India. But that is only the minimum direct cost. If one factors in mis-governance, then the total cost of Indian Parliament begins to look very formidable indeed.

Increasingly, legislators officiate as executives. The MPs Local Area Development Fund (MPLAD), which entitles each Member of Parliament to allot Rs 2 crore annually towards development projects facilitates this dilution of legislative functions. 57 years after Independence, India has ranked consistently around the 125th level on most international socio-economic indices, finding its place among the perpetually poor nations of the world.

While the costs are significant, Indian democracy is also extremely competitive. Almost half the sitting members lose their seat at every general election. After all, that is the only way for the voters to hold their elected representatives to account. One can only hope that this will induce the elected representatives to look afresh at the core issue of governance, if only to increase their own prospect of getting re-elected.

Salaries and perks of Members of Parliament.

MPs are paid salaries and allowances along with travel and other privileges so that they may perform their responsibilities as lawmakers without fear or favour. According to an estimate made a few years ago, this is what an MP makes in terms of salaries and allowances:—

1.Constituency allowance: Rs 12,000 per month.

2.Allowance for Attending Parliament: Rs 400 per day.

3.Office allowance: Rs 14,000/- per month.

4.Secretarial allowance: Rs 10,000 per month.

5.Stationery and postage: Rs 3,000/-.

6.Postage and franking: Rs 1,000/- per month.

Perks: (monetised estimates)

1.Each MP is entitled to a free house, transport to Parliament, and subsidised food. The cost maintenance and furnishing of the house is borne by the government as well. This could easily come to about Rs 1,20,000/- annually towards housing.

2.A daily travel allowance of Rs 8 per kilometre, which could translate in to Rs 48,000 for a chauffer driven car during session. In addition, a conservative estimate of rs 24,000 for food. Both these could total about rs 75,000 per year.

3.Each MP get 50,000 units of free electricity every year. At a conservative rate of rs 2.,50 per unit, this will come to Rs 1,25,000/-. In addition, water is provided free.

4.Each MP is entitled to 3 telephones, one in the office, one at home, and one in the constituency, and total free calls could be 1,70,000 free local calls per year. One of these lines can be used for connecting to the Internet. But MPs have to pay for these facilities if they use them beyond the free limit. Unutilised free calls can be transferred to their mobile phones. At a minimum the monetised value of this benefit would be about Rs 2 lakh per anum.

5.An MP can travel 32 times by air (business class) anywhere within India, along with his of her spouse of a companion. He or she can travel another 8 times from the constituency to Delhi to attend Parliament sessions. At an average air fare of Rs 7,000, this could easily come to Rs 5,60,000/- annually.

6.When travelling abroad on an official visit, the MP gets a free business class ticket, along with a daily allowance which depends on the country being visited.

7. Each MP is entitled to unlimited free passes to travel (first class or AC 2-tier) by train any where in the country, along with a companion. The annual rail fare could easily come to about Rs 1,00,000/-.

8. Most medical expenses of an MP are taken care of under the Contributory Health Service Scheme of the Union Government.

9. Each MP is entitled to a pension for life. (This was added by the previous NDA government). The basic pension is Rs 3000 per month, and it increases as per the length of service in Parliament. There are additional travel and medical benefits for former MPs as well.